Key Takeaway
The hardest strategic problem is not always a shortage of opportunities. It often appears when a company has too many attractive options at once: new markets, acquisitions, AI, regional expansion or new products.
According to BTU researchers, a strategic center is the organizing principle that helps a company decide where capital should go, what capabilities to build, what opportunities fit – and which good opportunities should still be rejected.
Growth Makes Choice Harder
Georgia’s business-sector turnover reached GEL 61.97 billion in Q1 2026, up about 10.7% year on year. Production value increased by approximately 12.4% to GEL 23.29 billion, while employment rose by around 3.7% to 799,400 people.
Growth expands opportunity, but it also increases the number of places where management can invest money and attention. Strategic drift becomes easier precisely when business conditions are attractive.
A Strategic Center Is Not a Slogan
A broad purpose statement or an ambition to become a market leader does not tell managers which projects to fund.
A strategic center must be specific enough to guide choices. It may be built around a durable problem, a customer group, a transferable technology, a regional ecosystem or the removal of unnecessary friction.
Why This Is Especially Relevant in Georgia
Georgia’s relatively small domestic market naturally pushes companies toward diversification. That is not inherently a problem. The problem begins when activities accumulate without a shared economic logic.
Large businesses generated 70.8% of turnover in Q1 2026, while small businesses generated 18%. Yet small firms accounted for 37% of employment. Large groups therefore need stronger capital-allocation logic, while smaller firms need protection from managerial and financial overextension.
Tbilisi generated 80.8% of business-sector turnover, which also makes regional expansion a strategic design question rather than simply a branch-opening exercise.
Five Ways a Company Can Define Its Center
Rita McGrath’s strategic-centering framework in Harvard Business Review offers several useful organizing principles. The point is not to lock a company into one product. It is to create a coherent logic across different products and investments.
1. A Problem
A company can follow a durable problem such as regional financial access, agricultural losses, energy efficiency or SME productivity.
2. A Customer
A company may organize around a customer group it understands unusually well – farmers, SMEs, hotels, tourists or parents – and serve several of that group’s needs.
3. A Technology
A transferable capability can also be the center: Georgian-language technology, cybersecurity, payment infrastructure, logistics software, analytics or energy management.
4. A National or Regional Ecosystem
In a small economy, companies can create scale by becoming essential to a wider system such as the Middle Corridor, Caucasus fintech, Georgian-language digital infrastructure or a regional education platform.
In 2025, trade represented 14.8% of Georgia’s GDP, manufacturing 9.1%, information and communication 8.0%, and transportation and storage 6.1%.
5. Friction Reduction
Some businesses can organize around a simple question: what is still unnecessarily difficult? Opportunities may exist in logistics, reporting, property management, insurance, healthcare navigation and administrative processes.
A Good Opportunity Is Not Always Good Strategy
The most important function of a strategic center is the ability to say no. A project can be profitable, technically feasible and fast-growing while still weakening the company.
Strategic evaluation should therefore ask not only what a project earns, but what capability it creates, what relationship it deepens and what existing activity must be reduced to fund it.
Novartis: Focus as a Strategic Choice
Novartis provides a useful illustration. Over time, the company narrowed its portfolio around innovative medicines. Alcon was spun off in 2019 and the 100% spin-off of Sandoz was completed in 2023.
Novartis described the Sandoz separation as completing its transformation into a more focused innovative medicines company.
The lesson is not that every diversified Georgian group should divest. It is that businesses held together inside one group need a clear reason why they create more value together than apart.
An Illustrative Georgian Mini-Case
Imagine a Georgian logistics company offered four opportunities: build a warehouse, launch payments, add insurance and enter a foreign market.
If its strategic center is ‘making movement of goods across the Caucasus simpler,’ each option can be tested against one rule: does it reduce time, uncertainty or cost in the logistics chain?
The center does not reduce opportunity. It connects opportunities.
What Strategic Centering Changes in Everyday Management
A clear center reduces the number of decisions that must move upward. Employees have a shared rule for choosing customers, product features and partnerships.
Strategic centering therefore supports capital allocation, organizational speed and decentralized decision-making at the same time.
What Georgian Businesses Should Do
- Define the company’s real center in one sentence.
- Test every current business and new project against that center.
- Create explicit rules for saying no.
- Combine financial return with strategic fit in capital allocation.
- Identify which capabilities, data and relationships should accumulate over time.
- Translate the center into everyday decision questions.
- Review the center periodically without changing it casually.
BTU Researchers’ Assessment
According to BTU researchers, one of the main strategic risks for Georgian business is not a lack of opportunity, but the accumulation of unrelated opportunities.
In a growing economy, competitive advantage may increasingly come not from having more ideas, but from choosing more coherently.
Key Findings
- Georgia’s business-sector turnover grew by about 10.7% year on year in Q1 2026.
- Growth expands opportunities and also increases the risk of strategic drift.
- A strategic center links opportunity selection, capital allocation and organizational identity.
- Diversification is natural in a small market, but activities need a shared logic.
- A center can be built around a problem, customer, technology, ecosystem or friction reduction.
- The Novartis case illustrates how portfolio focus can support a clearer corporate identity.
- Strategic clarity enables faster decisions deeper in the organization.
Why This Matters for Georgia
Georgia’s real GDP grew by 7.5% in 2025 and nominal GDP reached GEL 104.6 billion. Fast growth creates opportunities across multiple sectors.
But capital, management time and specialist talent remain scarce resources. Strategic centering helps companies concentrate those resources where different investments reinforce one another.
Conclusion
The job of strategy is not to find every attractive opportunity. It is to choose.
A company with a clear strategic center can answer three questions more easily: what do we do, what do we not do, and why?
For Georgia, this discipline may become more important as economic and technological change opens more paths than any one company can pursue.
Data and Main Sources
- National Statistics Office of Georgia – Activities of Enterprises, Q1 2026.
- National Statistics Office of Georgia – Gross Domestic Product of Georgia in 2025.
- Rita McGrath – ‘The Power of Strategic Centering,’ Harvard Business Review, July–August 2026.
- Novartis – official materials on the Alcon and Sandoz separations and strategic focus.
- BTUAI Research Team – Georgia-focused analytical interpretation.
This material is analytical and educational in nature. It does not constitute financial, investment, tax or legal advice. Professional advice should be obtained before making a specific decision.
Prepared by the academic team of Business and Technology University and the BTUAI Research Team, Tbilisi, Georgia.